Learn my lesson, business owner!

Anything in life you draw experience and knowledge from isn’t a failure unless you don’t learn from it. If we could accurately measure knowledge’s value, teachers would be paid like pro athletes.

My friend “Laverne” has a dilemma. Her client, “Shirley,” signed a contract requiring pre-payment. Shirley requested different payment arrangements. They agreed to do installments. Now, Shirley is behind and Laverne has already provided the service.

What should she do?

I had a similar problem once. My investment property was empty for months. We found a tenant, who paid first month’s rent AND security. We’re talking four digits CASH.

Red flag #1: NEVER make important decisions when you are: Hungry, Angry, Lonely, Tired, or Scared. I was SCARED of my duplex going to pot because I didn’t have a tenant to pay each month.

Red flag #2: She didn’t readily communicate. My property manager played “Where’s Waldo?” with her whenever rent was due. Waldo won. Every time.

Laverne took Shirley on because, like me, she needed the money. And Shirley paid at first, like my tenant. When Shirley fell behind, so did the communication. Next came the excuses. Shirley failed to negotiate well with Laverne, which is where most people mess up with their bills. Most bill collectors, like Laverne, are amenable to arrangements.

So what does Laverne do? If she goes to a collection agency, she’ll spend more than Shirley owes her. And even that’s not a guarantee that she’ll get her money. In the future, she should not change her payment policies. EVER. She has three choices for those who can’t afford her services:

  1. Do it pro-bono or as quid pro quo work
  2. Markdown (to a level she can live with and stick to it), or
  3. Turn her down and move on.

Shirley said she can’t afford to pay the entire service amount upfront (READ: DO NOT EVER accept checks from me unless you can afford to come after me if I bounce them). Laverne needs Shirley to make payroll. So, try this:

L: “It’s a $300 service Shirley; what can you afford?”

S: “I can do $200.”

L: “Today’s special only: 35% off! But, I need a 50% down payment first. The next installment HAS to be pre-paid before I provide the service. My PayPal accepts credit/debit cards, and I’ll take cash and/or money orders. And no, you don’t need to have a PayPal account to pay me.

Hope this lesson learned helps, especially “Laverne.” Be blessed.

Brian Thompson’s passion is motivating and encouraging others to write and to pursue Do-It-Yourself publishing. He is also author of the Christian fiction thrillers The Lost Testament, and The Revelation Gate. You can read more about Brian by visiting his author site.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: